Ecommerce order management guide 2024

Overview

Spreadsheets, manual order tracking, and a whole lot of guesswork—that had been the norm in ecommerce for years. Sounds tedious, doesn't it? Thankfully, we've moved on to ecommerce order management. Think of it as the central hub that keeps your sales, inventory, and customer satisfaction running smoothly.

In this guide, we'll unpack what ecommerce order management is all about. You'll learn its key uses, benefits, and the tools that turn complex processes into a walk in the park.

What is Ecommerce order management (EOM)?

Ecommerce order management is the process of handling the entire order process, from the moment a customer places an order to its final delivery. 

This process includes several key steps: 

• Receiving and processing the order

• Inventory tracking

• Selecting and packaging products

• Arranging shipment

• Ensuring timely delivery

Order management also involves managing customer data, updating order status, and handling returns and exchanges. The goal is to streamline these operations, ensuring order accuracy and efficiency in fulfilling customer orders, while maintaining real-time visibility of the order's progress for both the business and the customer.

The ecommerce order lifecycle

ecommerce order lifecycles begin with customer engagement and end with valuable data collection. Here's how it unfolds:

• Placing an order: It all starts when customers browse your online store. They select items and add them to their shopping carts. After deciding to purchase, they enter shipping details and select a payment method.

• Sales order processing: Once the customer places the order, it's sent to the inventory management system (OMS). Here, the real action begins. The OMS tracks and manages the order, allocating inventory to it. The order is then dispatched to the warehouse for picking to mark the transition from a digital cart to physical processing.

• Fulfillment: Warehouse workers pick, pack, and prepare the order for shipment. This step ensures that the customer gets what they ordered. Here, the OMS is key in tracking order statuses and resolving discrepancies. The system also provides tracking information and informs customers of the order status.

• Goods received: The customer receives their order at the end of the journey. Customers provide feedback through reviews or ratings and share their experience and the product quality.

• Data collection and analysis: The final step involves collecting and analyzing data from the OMS. Real-time data on sales, customer preferences, and order patterns are invaluable. Businesses track their performance, understand customer behavior, and make informed decisions for the future.

This lifecycle represents the journey of an order and the interconnectedness of various business processes.

Key challenges in ecommerce order management system

As with any complex process, there are bound to be challenges in ecommerce order management software. Let's look at some of the key challenges businesses face and how to overcome them.

Inventory management and stock accuracy

Maintaining accurate and up-to-date inventory records is key to fulfilling orders. If your inventory isn't accurate, you'll face stock outs or have too much stock, leading to missed sales, unhappy customers, and high storage costs.

So, what do you do? 

Real-time inventory tracking systems and automated stock replenishment keep your inventory levels spot on. Also, regularly checking your inventory and syncing it with your sales data ensures accurate stock records, making it easier to anticipate what your customers need next.

Efficient order processing and fulfillment

Order processing and fulfillment refers to the speed and accuracy with which you process and deliver orders to customers. Inaccurate and slow order processing causes delays or errors which further results in customer dissatisfaction and reduced repeat business. 

Implement automated order processing systems, integrate their sales channels, and optimize warehouse operations to improve efficiency. Analyzing the order fulfillment process for potential bottlenecks and using AI and machine learning for predictive analysis also improves efficiency and timeliness.

Handling returns and exchanges

Returns and exchanges are a natural part of shopping, but the additional costs, logistical complexity, and potential customer dissatisfaction make them challenging to manage.

It's not just about accepting returned products—it's about maintaining customer trust. First, create a clear returns policy so your customers know what they can and can't return, and how they can do it.

Next, focus on efficient processing. You'll keep those customers happy if you're quick to handle returns and exchanges. But, it's not all about speed—an automated system reduces human errors and streamlines the process.

And here's a tip: track the reasons for returns (like fit issues or defects) to improve your products. Efficient returns management leads to satisfied customers, who're more likely to stick with you.

What are the use cases of ecommerce order management?

ecommerce order management software is more than just a behind-the-scenes operation—it's a crucial part of managing customer expectations  and streamlining business processes. Here are different applications of using it:

1. Inventory fulfillment 

Keeping an eye on inventory levels is the difference between fulfilling orders and disappointing customers. When items run out of stock, it's not just a missed sales opportunity—it's an open invitation for customers to turn to competitors.

This is where an OMS comes in. Syncing an OMS with your inventory management systems automates the reordering process and simplifies the entire inventory fulfillment operation. 

Imagine all your inventory data centralized in one spot. Sales teams, warehouse staff, and customer service all access the same updated information and ensure everyone's on the same page. 

You'll simplify communication across different departments, reducing stockouts and maintaining business operations.

2. Customer management

An OMS captures essential customer data and, when integrated with CRMs and customer engagement platforms like Freshworks, improves the customer experience.

Imagine a customer visiting your website. They use a chatbot that’s integrated with the OMS. This integration allows customers to self-serve many common queries. 

For example, if they want to know the status of their order, the chatbot retrieves that information from the order management system and provides real-time updates. This creates a smooth, end-to-end process that makes customers happy.

The beauty of integrating your OMS with chatbot software lies in its versatility and efficiency. From ordering to receiving post-delivery support, customers use it throughout their journey. Chatbots handle multiple requests simultaneously with this setup, which speeds up query resolution. 

It's a win-win: customers enjoy a more personalized and responsive service, and your business becomes more efficient.

3. Built-in scalability 

Your business might start small, but as it grows, your needs evolve. 

An OMS offers the flexibility and scalability your growing business demands. As your business expands, integrate new features and functionalities into the existing system. 

Businesses that experience seasonal surges need this adaptability. Take a ski clothing retailer, for example. They need a system capable enough to handle a spike in orders during the winter holidays, ensuring they don't miss a beat when demand is at its highest.

This way, an OMS isn't just a tool for today—it's a solution that grows and adapts with your business, making it an invaluable asset for long-term success and sustainability. 

4. Business insights 

An OMS churns out detailed reports covering everything from sales trends to customer behavior. Keeping your business on track requires this wealth of information.

Say you spot a trend in your OMS data showing a particular item flying off the virtual shelves. You can ramp up production or stock levels to keep up with this demand. 

On the flip side, if another product isn't hitting the mark, your OMS data guides you to tweak your marketing strategies or adjust pricing. 

Essentially, these insights provide actionable intelligence that drive your business forward, helping you make informed, data-backed decisions to boost your operations and sales.

What are the benefits of an ecommerce OMS? 

ecommerce Order Management Systems (OMS) streamline operations and enhance experiences. Here's how they make a difference:

For customers:

• Improved customer experience: OMS improves the customer journey in several ways. Order updates keep customers informed about their order status, so they don't have to contact customer service. Integrating with chatbots also enables 24/7 service, allowing chatbots to access OMS data and route complex issues appropriately.

• No paperwork: Going digital with an OMS benefits customers too. An OMS sends digital invoices and packing slips via email to speed up the entire process and make it more environmentally friendly.

For employees:

• Automation: OMS automates customer communication, inventory management, and data collection. It reduces staff workload, allowing them to focus on more strategic duties. Keeping accurate digital records also minimizes human error in tasks like misplacing orders.

• Improved employee productivity: Automation frees up employees to work on more important projects. Having central data access makes interdepartmental communication easier, so you don't have to juggle multiple systems, which increases productivity.

• Integrations: OMS integrates with other business systems like CRM and accounting software. It eliminates the need for manual data entry and reduces the risk of errors.

What features should you look for in an ecommerce OMS? 

Consider these non-negotiables as you select an OMS to increase efficiency:

• Order tracking: An ideal OMS tracks orders from placement to delivery to provide real-time updates on inventory levels and shipments. Order progress updates are crucial for both your team and customers to stay in the loop

• Customer management: Select an OMS that stores and organizes customer data, including contact details and purchase history. It simplifies customer interactions and enhances loyalty by providing personalized service and targeted marketing.

• Payment processing: Integration with popular payment gateways such as PayPal and Stripe is essential. The OMS should handle payments and refunds to ensure a secure and convenient experience for customers. Reliable payment processing maintains customer trust and smooth operations.

• Shipping: Most OMSs facilitate easy printing of shipping labels and tracking of shipments, with integration with major shipping carriers like UPS or FedEx for streamlined logistics. Efficient shipping management equals prompt deliveries and customer satisfaction.

• Inventory management: You need real-time inventory levels and automated product reordering to prevent stockouts and overstocking. Meeting customer demand and minimizing storage expenses require the right level of inventory.

• Reporting: An OMS with robust reporting features on sales, customer behavior, and order trends is essential for tracking business performance. Identifying growth opportunities and enhancing operational efficiency is easier with effective reporting tools.

Key considerations when choosing an ecommerce OMS

Consider these key factors to ensure you choose a system that meets your specific needs and goals.

• Integration with the current ecommerce stack: Assess how well the OMS integrates with your existing ecommerce platform, CRM, ERP, and other tools. Integrating different systems is essential for operational efficiency and data consistency.

• Manual process automation: Identify which manual processes in your order management cycle the OMS can automate. Automation increases efficiency, reduces errors, and saves time.

• Alignment with business needs: Determine how the OMS meets specific business requirements. Consider aspects like multi-channel support, international sales capabilities, and customization options.

• Scalability: Consider your current business size and future growth plans. Having an OMS that’s scalable and flexible is essential to accommodating business expansion.

• Industry-specific features: Depending on your industry, certain features may be more relevant. For example, businesses in fashion or perishables might need advanced inventory management features.

• Customer personalization: Choose an OMS that supports your types of customers and their buying habits. Look for features like personalized customer profiles and targeted communication tools.

• Budget: Evaluate the cost of the OMS against your budget. Consider not only the initial investment but also long-term costs like subscription fees, maintenance, and upgrades.

• Ease of use and support: OMSs should be easy to use and offer good customer support. Simple-to-use systems allow your team to use them efficiently, and reliable support means you'll have assistance when needed.

• Reporting and analytics: Analyses and reports are crucial to informing business decisions. Check if the OMS provides comprehensive analytics tools.

Top ecommerce order management systems for 2024

Discover the leading ecommerce order management systems for 2024, each offering unique features and capabilities. 

Freshworks

Freshworks is a modern messaging platform designed for customer engagement and support. The chatbot is a frontline service that allows customers to self-service many aspects of the order process. 

Communicate with customers through various channels like websites, mobile apps, and social media. Integrate Freshworks into an OMS to improve customer service aspects of order management, like handling inquiries and providing updates.

Key features

• Multi-channel messaging: Allows communication with customers across different messaging channels from a single interface.

• Automated bots and AI: Use bots to provide instant responses and support.

• Unified agent workspace: Gives agents context of the customer’s order history and information for faster resolutions.

Pros

• Easy-to-use interface

• Automated workflows

• Easily scalable

Cons

• Limited spam-blocking features

“Freshworks has been one of the best chat support systems I have used till now. I have worked with multiple other chat support systems and I can confidently say that Freshworks is one of the best performed among them.

The unparalleled amount of features provided and the best-in-class customization features are a couple of things that make Freshworks stand at the top.

The number of integrations available for Freshworks has helped me and my organization achieve faster resolution of a lot of customer queries and assist our user base in a more effective and efficient method.”

- G2 Review

Linnworks

Linnworks integrates multiple selling platforms, including online marketplaces and websites, into a single, centralized interface. It specializes in inventory management, order processing, and shipping logistics and facilitates cross-channel marketing and fulfillment for businesses.

Key features

• Multichannel inventory syncing: Linnworks enables real-time synchronization of inventory across various sales channels, ensuring consistent stock levels and preventing over-selling.

• Stock history reporting: The platform provides detailed stock history reports, allowing businesses to track inventory changes over time for better stock control and decision-making.

• Order management: Linnworks optimizes the entire order management process, from order capture and processing to fulfillment, across all integrated sales channels.

Pros

• Fully customizable

• Integrations with website and online marketplaces

• Easy-to-use interface

Cons

• Buggy updates

• Slow customer service

Brightpearl

Brightpearl is an all-in-one retail management system for managing inventory, orders, accounting, and reports. It integrates with multiple online selling platforms, like Amazon, eBay, and Shopify, as well as brick-and-mortar point-of-sale systems.

Key features

• Warehouse management: Track and control inventory across multiple locations and channels.

• Interconnected data hub: The platform integrates and synchronizes data across sales, inventory, accounting, and customer management systems for a unified view.

• Multichannel integration: Connects with various online marketplaces and shopping carts, centralizing sales channels for efficient order processing.

Pros

• Comprehensive solution

• Real-time inventory updates

• Dedicated customer success manager

Cons

• Lack of training resources

• Steep learning curve

QuickBooks Enterprise

QuickBooks Enterprise is a powerful accounting software that also offers inventory management capabilities. It's best for small to mid-sized businesses and integrates with popular ecommerce platforms like Shopify and Magento.

Key features

• Inventory tracking: Easily track inventory levels, costs, and sales in real-time across multiple locations.

• Purchase order management: Create and manage purchase orders, track supplier history, and receive automated alerts for low stock levels.

• Barcode scanning: Reduce manual data entry errors and improve warehouse operations with barcode scanning capabilities.

Pros

• Seamless integration with QuickBooks accounting software

• Flexible pricing

• Workflow automation

Cons

• Limited reporting options

• Not suitable for complex inventory needs

Veeqo

Veeqo (now acquired by Amazon) is an advanced order management and shipping platform tailored for ecommerce businesses. It streamlines the process of managing orders, inventory, and shipping operations. Veeqo’s key strengths lie in its ability to automate many aspects of the fulfillment process, from order syncing and inventory updates to shipping label generation.

Key features

• Order filters: Quickly filter orders by status, channel, SKUs, and customer name.

• Automation rules: Create custom automation rules to automatically assign orders to specific warehouses, carriers, and more.

• Address validation: Automatically validate customer addresses to prevent shipping errors and delays.

Pros

• Team collaboration features

• Over 21 direct integrations

• Built-in shipping software

Cons

• Inflexible features

• Slow dispatch times

IBM Sterling Order Management

IBM Sterling Order Management is a comprehensive order management platform designed for large-scale enterprises. It offers powerful features for managing orders, inventory, and fulfillment across multiple channels and locations. 

Key features

• AI-powered: Insights to scale operations and maximize profitability. 

• Real-time inventory management: Check inventory across all locations. 

• Progressive scheduling: Automatically allocate orders based on priority and product availability. 

Pros

• Centralized order management

• Strong integration framework

• Customized monitoring

Cons

• API features need improvement

• Expensive for smaller businesses or startups

BigCommerce

BigCommerce is a popular ecommerce platform that offers a comprehensive set of features for online businesses. It includes order management capabilities to help merchants efficiently manage orders, inventory, and shipping from one centralized location.

Key features

• Custom views: Organize orders easier to simplify order fulfillment.

• Order actions: Set rules for automating fulfillment tasks, such as assigning orders to specific warehouses or carriers.

• Complete visibility: Track order status, inventory levels, and shipping information in real-time. 

Pros

• Suited to businesses of all sizes

• Payment and shipping integrations

• Advanced analytics and reporting

Cons

• Learning curve

• Limited SEO-features

Netsuite

Netsuite is a cloud-based ERP (Enterprise Resource Planning) software that offers a wide range of features for businesses of all sizes. One of its key capabilities is order management, which allows users to manage orders from multiple channels and locations.

Key features

• Customizable workflow automation: Automate order fulfillment tasks to save time and reduce errors.

• Omnichannel experience: Connect and manage orders from different sales channels, including retail and online stores and marketplaces.

• Inventory management: Real-time inventory visibility into inventory levels across all locations to avoid stockouts and overselling.

Pros

• Advanced analytics and reporting

• Extensive integrations

• Comprehensive platform

Cons

• Steep learning curve

• Pricey for startups and small businesses

Using Freshworks for your ecommerce order management

Freshworks is exactly the kind of assistant you need to automate your ecommerce order management software. By integrating Freshworks, you open the door to dynamic campaigns and meaningful conversations. 

The result? Higher customer satisfaction and engagement. 

It's not just about managing orders—it's about building relationships and making shopping more enjoyable. Freshworks brings a personal touch to your ecommerce operations and turns each customer interaction into an opportunity for growth and connection.